C) Ethics and Property
Ethics and property
Interview set on the OboxPlanet. Marco is an experienced visitor from Earth, Ayn is the CEO of an insurance/security company on OboxPlanet.
Marco: Thank you, Ayn, for your time. Ethics and property deals with be the question of what you should do with your property and what you should not do. You are CEO of an insurance / security company. You are in the business of making sure that people don’t do what they should not do, right?
Ayn: I think you could say that. Our business is the prevention of crime and compensation when it happens.
Marco: I have told you about our system on Earth, where the state has the role of protecting “life, liberty, and the pursuit of happiness,” while private insurance companies cover damages wherever the state fails to do so. They pay for damages caused by criminals, replace stolen goods, and even cover medical bills and loss of income if someone gets hurt. I imagine you also have insurance companies for damages, but who replaces the state’s role on OboxPlanet?
Ayn: You’re right, we replace the damage caused by criminals, but we also work together with security companies, lawyers, and correctional facilities. That’s why we call ourselves securance companies, providing for security and for insurance.
Marco: Can we elaborate on the security and protection part?
Ayn: Sure. There is damage prevention before something happens and damage control after the fact. Damage prevention includes security arrangements like locks on doors, security cameras, patrolling security personnel in neighborhoods, and even self-defense, including guns and proficiency in using them. We, as a securance company, encourage and support such efforts and reward them with lower premiums.
Marco: And what about after the fact, how do you resolve conflicts?
Ayn: We can separate two cases. Either both parties are known and present, or we are looking for one of the alleged wrongdoers. An example of the first case is if two neighbors disagree or if a customer gets into a fight with a seller. Then the parties give their complaints to their respective securance companies, and these companies work out a solution. If the quarreling parties can’t agree, they meet before a neutral judge. In these cases, our role is mediation and conflict prevention.
Marco: What do you mean by a neutral judge, who would that be?
Ayn: Let me back up a little. Back in history, people would take their quarrels or complaints to a respected person, like the eldest in a village, and as long as this person acted fairly, he would keep his position as arbiter and judge. The rulings of these “laymen judges” established a tradition of what is right and wrong, widely accepted and at the same time depending on the cultures and the times.
Marco: That was a long time ago. What has changed?
Ayn: As time passed, trade expanded in volume and distance, and across different cultures. Disputes became more complicated and specialized law firms began offering their services of providing mediation and enforcement of convictions if necessary. The procedures and the body of law became more refined, including appeals procedures and cross-culture arbitration. What remains unchanged is that the success of these firms rests on both conflicting parties considering the sentences as fair as possible.
Marco: And what about if the wrongdoer is on the run?
Ayn: Then the first thing we do is compensate the victim and then chase down the criminal. We post a fee for his or her apprehension, and headhunters track the criminal down.
Marco: How could a criminal consider the judgments fair?
Ayn: Because all contracts with securance companies stipulate that you may never initiate physical aggression against others. That includes aggression against property, like stealing or embezzling. Now: either the criminal either has a contract with a securance company, in which case his criminal behavior would violate the contract he signed, a contract in which he agreed to punishments for doing so. Or he has no contract and no company helping him. He can still defend himself, but he would have to organize that himself. Besides, I know nobody who does not have a securance contract – even beggars have one from charitable organizations.
Marco: How much do these contracts cost?
Ayn: To make the figure credible, I want to relate it to your experiences on Earth. I once read that on Earth, expenditures for law enforcement, which includes police, judges, prisons, internal state security and even firefighting, cost l.8% of gross production in Europe in 2022 (Eurostat). People on the OboxPlanet are much richer and our private institutions are very competitive and much more efficient than state monopoly institutions. In short, average premiums cost less than 1% of people’s incomes.
Marco: What happens to a convicted criminal?
Ayn: There are two goals when judges consider sentences: firstly, to minimize future crimes, and secondly, to make the victims whole. The criminals ideally pay for the damage they caused, the expenses for catching them, the legal procedures, and a punishment fee. The challenge is to keep the prisoner from doing more harm and at the same time enable him to pay back his debt. Those arrangements and companies that can achieve this goal are more successful in the market. They can offer lower premiums.
Marco: Do they get locked up in a labor camp?
Ayn: There are lots of different solutions and innovations in this field. One major consideration is whether it is a first-time offense or a repeat offender. A first time offender may go back to his or her normal life and pay off the debt, while others are locked up in high-security facilities. The worst of them, serial killers and child molesters, are sometimes expelled from all human societies and literally dropped in the desert.
Marco: Is there a death penalty?
Ayn: That has almost disappeared. One reason is that this would have to be stipulated in your contract. Every client would have to sign to be executed in extreme circumstances, and who would want to take the chance of getting executed as the result of a conceivable wrongful conviction?
Marco: Fair point. I would’t. Thank you once again.
Interview set on Earth. Marco is an Experienced OboxPlanet Explorer
Part 1: The Neutral Judge
Interviewer: Ethics and property are related to politics, legislation, jurisdiction, and even war. How long will it take to cover this topic?
Marco: (laughs) Not as long as you think. Politics, legislation, and wars require a state, which we don’t have on the OboxPlanet. So, we’re left with jurisdiction. However, jurisdiction itself is a big topic.
Interviewer: Okay, let’s get straight to the point. We refer to the stateless society on the OboxPlanet as anarcho-capitalism. That sounds like anarchy, chaos, and the law of the jungle.
Marco: No. It simply means “no rulers” and “free market.” People on the OboxPlanet have the same need for law and security as people on Earth.
Interviewer: But without a state, who determines what is lawful?
Marco: A look at our history on Earth helps. How were disputes resolved way back and in smaller communities? Simplified, disputing parties would go to the village elder or another respected person for a ruling. These rulings became guidelines for future judgments, and the totality of these judgments formed the basis of a legal tradition. This is pretty much how it still works on the OboxPlanet.
Interviewer: And what is the difference from Earth?
Marco: The biggest difference from Earth is the neutral judge. In other words, the conflict resolver must never be a party in the conflict. Put more simply, the judge must never simultaneously be the plaintiff or defendant.
Interviewer: But that’s common sense! Who would want a biased judge?
Marco: That’s what I thought, and then I had a realization that still troubles me today. A lawyer on the OboxPlanet, Hans, once asked me what the idea of the state was. I told him it’s a group of people who make regulations that everyone must follow. Upon which the lawyer asked me: what if somebody does not agree, who decides who is right? And I answered: the courts, the state courts. Hans then looked at me incredulously and asked: Are you serious? So, if you sue the state and say it doesn’t keep its promises, state judges decide who is right?
Interviewer: I’ve never seen it that way. I think I need to digest this first. Let’s take a short break and let this sink in.
Part 2: Further Details
Interviewer: Okay, I’m ready for the next challenge. What was that about the neutral judge?
Marco: The neutral judge is the core idea of the legal system on the OboxPlanet. Hans Hermann Hoppe, who scientifically elaborated this principle, likes to illustrate the topic with the following story: “Imagine a group of small children playing and often having disputes. Then Julius, one of the children, says: ‘I have an idea on how we can solve all disputes. I, Julius, will always say who is right. This also applies when I’m involved in the dispute.’ Even small children will sense that this is a strange rule. Yet, the state is essentially nothing more than Julius, the ultimate conflict resolver in all disputes, including those in which the state itself is involved.”
Interviewer: Let’s return to OboxPlanet. How does it work concretely? Where do people find neutral judges?
Marco: Take two neighbors. They have a dispute and can’t agree. One makes noise and smoke, and the other feels disturbed in his right to peace and relaxation. They can’t agree and want to resolve it legally.
Interviewer: What if one party doesn’t want a peaceful solution?
Marco: Those who use violence are treated as criminals, just like on Earth. We will talk about this in an interview on safety and security.
Interviewer: But Jurisdiction and security issues are closely related, right?
Marco: Of course, but there is a conceptual difference. Jurisdiction is about what is right and security is how to enforce these laws. In the security chapter, you’ll see why almost everyone on the OboxPlanet has insurance to protect themselves and their property. Or better: securance contracts, as they call them there, because it does not only cover the damages, like our securance companies, but also damage prevention and sanction, e.g. security. And here’s the connection to jurisdiction. All these securance contracts have a clause requiring insured individuals to resolve conflicts peacefully; otherwise, they would be criminals, and you can’t insure criminals.
Interviewer: How would the dispute between the neighbors be resolved?
Marco: Securance contracts contain procedures for conflict resolution, which we also have on Earth. The securance of both neighbors would discuss the case and propose a solution. If this is acceptable, the case is settled. If one party disagrees, the disputants must find a mutually acceptable, neutral judge. This judge would make a ruling, and that’s final. There are also appeal procedures and other interesting legal details, but that’s beyond the scope of an interview. I encourage you to consult the extensive literature on conflict resolution in a private law society. As I like to say: I envy all who have this exciting discovery journey still ahead.
Interviewer: Which judges are successful on the OboxPlanet?
Marco: The most successful judges are those who have made the best judgments in the past, meaning judgments that are understandable and maximally acceptable for both parties.
Interviewer: For both parties to accept, they must have the same idea of right and fair. What if one of the disputants believes in Islamic Sharia and the other is a strict Catholic?
Marco: Bingo, with this question, we arrive at a second legal principle: non-violence. (The Non-Aggression-Principle NAP or Zero-Aggression-Principle ZAP, as it is called on the OboxPlanet). A law professor explained it to me this way: If both parties have the same values, if they belong to the same religion, so to speak, the conditions for an amicable settlement are optimal. If not, some common ground must be found. It must be something both can agree on. And there is one rule that applies to all people, everywhere and at all times: non-violence. In other words, if I say: You shall not commit violence against your neighbor, all people can follow this rule. If I say: I may commit violence against you and you may not commit violence against me, then we have different rules, and that is usually unacceptable.
Interviewer: Ok, I understand. Non-violence is the lowest common denominator in interpersonal value issues. What about property?
Marco: Conflicts are exclusively about scarce goods and the question of who can do what with them. Example: I want this banana, and you want it too. Or I want to stand in this place, and you also want to stand there at the same time.
Interviewer: And how is that resolved?
Marco: Quite simply, it’s the same principle we teach our children when we say: Whoever had the toy first gets to play with it first. Applied to the adult world, it means: If someone finds something that didn’t belong to anyone before, they can keep it. After all, there can be no conflict at that moment. And thereafter, no one may take it away by force. For example: I discover a new island or use land that no one has claimed before. Or I gather berries or hunt rabbits in no man’s land.
Interviewer: These examples sounds quite outdated. Much land is already taken, and people in cities buy rabbits frozen to eat or at the pet store as pets.
Marco: Sure, but the principle also applies everywhere we trade property or services. It applies when we shop, work for money, or give gifts. Everything is allowed as long as there is no violence involved. And very importantly, the principle also governs our interactions with other people. Every person is always the first owner of their own body and thus has the right to physical integrity. That’s why forced labor, slavery, or abuse are unacceptable, and that applies to children as well.
Interviewer: That makes sense, but the devil is in the details. For example: If someone discovers a new island, how much land can they keep, and what must they do for it to belong to them? Or: Can I do whatever I want on my land, like make noise at midnight?
Marco: On OboxPlanet, the first question is always: Who owns the property? Who discovered it, who is the “original appropriator” or who has lawfully acquired it from the “original appropriator”? Then comes the question of what one can do with their property, which must be decided by neutral judges, as we saw with the conflict of the two neighbors above.
Interviewer: That sounds complicated. Do I need to go to a judge every time to know if I can make a fire in my garden?
Marco: No, quite the opposite. Good judges make rulings that are considered maximally fair and understandable. They must fit into the culture, traditions, and times. Thus, the legal system on the OboxPlanet is as close as possible to what is considered “common sense” in a society. The legal system is also more stable than on Earth because there are no politicians and bureaucrats who can legislate and make rules at will and at any time.
Interviewer: But isn’t that more tedious and time-consuming for individuals compared to Earth, where the legal system is simply as it is?
Marco: Again, on the OboxPlanet, common sense suffices for almost everything. That’s a far cry from arbitrary and sometimes even conflicting laws and bureaucratic regulations on Earth.
Interviewer: In summary, how would you describe the main differences from Earth?
Marco: Surprisingly large areas and industries on Earth function by the same rules as on the OboxPlanet, according to private law principles. For example, international trade law has its own rules, private arbitration, and no state sanctions. Credit card companies also manage without state fines. Civil law was originally a civilian matter before politicians, bureaucrats, and state judges increasingly interfered, for example, in divorces or inheritances.
Public law, on the other hands, works completely differently. The state makes regulations on how to interact with the state and the state is simultaneously the ultimate judge in all disputes. I do not need to point out the dangers of this logic, keyword Covid. We should also be aware that the practice of “legislation” by “lawmakers” is a relatively new development on Earth and only gained acceptance with the worldwide spread of democracy and the myth that “we govern ourselves”.
Interviewer: Yes, but without a state, who takes care of the poor, who builds roads and ensures security?
Marco: (laughs) Welcome to the other chapters on this website and enjoy your journey of discovery!
What experiences on Earth, past and present, help us understand life on the OboxPlanet?
The fundamental difference from Earth is that, on the OboxPlanet, individuals have the autonomy to decide how they use their property, free from the influence of politicians and bureaucrats. As Lord Acton pointed out, “It is easier to find people fit to govern themselves than people to govern others. Every man is the best, the most responsible, judge of his own advantage.”
This raises the question: What is considered people’s own advantage, and what would individuals do if politicians did not interfere? Who would take care of the less fortunate, the elderly, the sick and would there be philantropy to replace the many state subsidies of “public goods” like arts, universities and public transportation?
In the present day, the state—comprising lawmakers and bureaucrats—exerts control over approximately half of all goods produced annually and intervenes in our daily lives from the moment we wake up until we go to sleep. They establish rules on building houses, streets, and workplaces, interfere in contracts, and license numerous occupations and products. These state-imposed restrictions lead to relative impoverishment; in other words, without these limitations, everyone would be much wealthier.
What would you do if the state would return all the tax money, if you had roughly double of our income today? Would you spend it all on yourself, to buy more food and additional cars? History provides a clear and compelling lesson: as people accumulate more wealth, they tend to show greater concern for their fellow humans, animals, general welfare, nature conservation, and the environment.
The Industrial Revolution, less than three hundred years ago, serves as a striking example. Before this period, much of humanity lived at a subsistence level, always one harvest away from starvation. With the gradual increase in wealth, people began investing in various humane and significant projects. Despite the 19th century being relatively poor by today’s standards, even in affluent countries like England, numerous cities, canals, train tracks, sea transport services, and social institutions such as the Salvation Army and the Red Cross were established. These were predominantly funded and initiated by private individuals.
The newly affluent industrialists and merchants left lasting legacies in the form of hospitals, universities, libraries, parks, concert halls, operas, and research laboratories.
Let’s turn back to the OboxPlanet. In the discovery-lab “wealth creation” on this website we can learn why the inhabitants of the OboxPlanet are significantly wealthier than those on Earth. Since you are probably among the privileged class of humans on Earth today, on the OboxPlanet, your disposable income might “only” be a few times more than your current income, let’s say 5 to 10 times higher. For the least affluent individuals on the OboxPlanet, the difference to the poorest on earth is much more dramatic. We can safely assume that they would enjoy about your living standard on Earth today.
For the most affluent inhabitants of the OboxPlanet, the spirit of philanthropy and the desire to “build monuments” for future generations is unchanged since the 19th century, but with many times more resources than on Earth. Now it’s Christmas for you. Wish for any “public goods” you would want to see financed. Nature conservation parks? Longevity research? Space exploration and travel? Free education, health care and social security for those who cannot afford it?
You can find just about all that you can imagine realized on the OboxPlanet.
By the way, imagining a tenfold increase in average income may seem challenging, but reflecting on the historical context provides perspective. Consider that the average income in England today is approximately 40 times higher than it was 250 years ago. If you were to tell someone from 1750 that average incomes would rise 40 times, it would likely be even more difficult for them to imagine. Therefore, while a tenfold increase might seem ambitious, it’s not unprecedented when looking at the trajectory of historical economic growth.
In the introduction, we asserted that wealth, philanthropy, and the aspiration to achieve a sort of immortality through charitable acts would result in the voluntary funding of various “public needs” by wealthy individuals. The key rationale for this belief is based on examining historical events, particularly those of the 19th century. So, let’s take a closer look at this historical period for a more detailed understanding.
The following statistic illustrates the dramatic facts of this unique event in human history.
The basic facts up to 1750 reveal a global pattern: virtually all countries throughout history lived in close proximity to the starvation level, a situation often referred to as the “Malthusian trap.” In this trap, when there were favorable harvests, more people would survive, leading to population growth. Conversely, during harsh times, people would starve, resulting in a decline in population.
During this period, rulers had limited flexibility to impose high taxes or engage in excessive spending. If taxes exceeded a few percentage points, the population would face the risk of starvation, leaving rulers with little room for financial maneuvering. The Malthusian trap reflected the delicate balance between food production and population size.
Around 1750, England became the first society in history to break free from the Malthusian trap permanently. This breakthrough was a result of a combination of technological innovations and political circumstances that allowed for increased production per person. Initially, this led to more people surviving, though just barely. However, shortly thereafter, average income began a slow but steady increase—something unprecedented in human history.
While we might perceive a doubling of income, such as going from $2 per day in 1800 to $4 per day in 1900, as a choice between two forms of hardship, it represented an entirely new reality for the people affected. This improvement protected them from starvation even in challenging years, marking the first time in history that such resilience was achieved. Additionally, it paved the way for the development of a middle class and the rise of wealthy entrepreneurs.
People during the 19th century, benefiting from increased wealth and experiencing relatively little state influence compared to today, directed their newfound prosperity in various ways. Middle and high incomes grew at rates even faster than average wages. While entrepreneurs and the expanding middle class spent considerable sums on personal consumption, there was also an explosion of private initiatives during this period.
Many of the great public institutions we recognize today were founded during the 19th century, and they were primarily financed by voluntary contributions. The legacy of charity institutions like the Salvation Army and privately funded “public goods” such as universities, libraries, hospitals, parks, and conservation efforts still influences and benefits society today. The philanthropic spirit of that era played a crucial role in shaping enduring institutions that continue to contribute to the public good.
We claimed that along with increasing wealth, people, especially the wealthy, become generous, some motivated by benevolence, others by fame in posterity. As soon as the Industrial Revolution got going, there was an outpour of philantropic endevors which lay the groundwork of great institutions whose legacy we still profit from. Among these are Harvard Medical School: Founded in 1782, Harvard Medical School is one of the oldest medical schools in the United States, and is known for its excellence in medical education and research.
Harvard Medical School: Founded in 1872
ohns Hopkins University: Founded in 1876 by Johns Hopkins, a wealthy businessman and philanthropist.
Smithsonian Institution: Founded in 1846 by James Smithson, an English scientist and philanthropist, the Smithsonian is a group of museums and research centers located in Washington, D.C. that house collections of art, history, and science.
Metropolitan Museum of Art: Founded in 1870 by a group of American citizens, this museum in New York City is one of the largest and most comprehensive art museums in the world.
University of Chicago: Founded in 1890 by John D. Rockefeller.
Massachusetts Institute of Technology (MIT): Founded in 1861 by William Barton Rogers,
Stanford University: Founded in 1885 by Leland Stanford, a railroad magnate and former governor of California.
Mayo Clinic: Founded in 1889 by Dr. William Worrall Mayo and his sons.
Carnegie Mellon University: Founded in 1900 by Andrew Carnegie,
Rockefeller University: Founded in 1901 by John D. Rockefeller.
And here some social institutions
International Red Cross – founded in Geneva, Switzerland in 1863, this organisation aimed to provide aid to wounded soldiers in times of war and promote humanitarian values.
Salvation Army – founded in London in 1865, this organisation is a Christian charity that provides aid and support to those in need.
Now it’s your turn.
If you were extremely rich, what would you support?
Things we could learn and implement from the OboxPlanet:
Scale back the state everywhere to free private initiative and benevolence.
Illustrations
John Stossel: Private Disaster Relief is Better Than FIMA